China
Listening in on US–China relations
Author: Kai He, Griffith University
Steve Bannon, the former White House chief strategist, claims that US President Donald Trump has put together a ‘war council’ to take down the Chinese Communist Party (CCP) during the COVID-19 pandemic.
There have been a series of rhetorical attacks directed at the CCP from high-ranking US officials since late June. National Security Adviser Robert O’Brien, FBI Director Christopher Wray, Attorney General William Barr and Secretary of State Mike Pompeo have been dubbed the ‘four horsemen of the apocalypse’ tasked by Trump to overthrow the CCP. The Trump administration has taken concrete actions to decouple bilateral relations by closing the Chinese Consulate General in Houston, sending Health Secretary Alex Azar to Taiwan and attempting to ban Chinese social-media giants TikTok and WeChat in the United States.
China’s reactions have been surprisingly conciliatory given its reputation for ‘wolf warrior’ diplomacy and tit-for-tat actions against the United States. In an interview with Xinhua on 5 August, China’s Foreign Minister Wang Yi firmly rejected the idea of a new Cold War and proposed easing current tensions through dialogue ‘at any level, in any area and at any time’.
Two days later Yang Jiechi, Director of the Office of Foreign Affairs of the CCP, published an article titled ‘Respect History, Look to the Future and Firmly Safeguard and Stabilise China–US Relations’. Yang praised the legacy of US engagement with China — pioneered by the Nixon administration — and called for more ‘mutually beneficial cooperation in all fields’.
China’s goodwill diplomacy seems too little too late because no one in the Trump administration is taking it seriously. Beijing’s call for dialogue is falling on deaf ears in Washington in part because any such communication is seen as ‘diplomatic kowtowing’ by the United States.
But this interpretation of Chinese diplomacy seems overly simplistic. Chinese culture and history offer a better way to understand the three messages China intends to convey to salvage relations with the United States.
First, China does not want a Cold War with the United States. Wang Yi remarked that ‘China was not the former Soviet Union and it had no intention of becoming another United States’. This might be wishful thinking from the CCP, but it takes two to tango, and China has informed the United States that it will avoid the ‘Cold War trap’ that ensnared the Soviet Union and the United States.
Wang and Yang highlighted the good old days of US–China relations after Richard Nixon’s 1972 visit to remind their US counterparts that the two countries co-existed by transcending their ideological differences. This is a Tai-Chi-like response to the punches thrown by the ‘four horsemen’.
The second message is that the United States is unable to wage this Cold War alone. China wants to make it clear to US allies — including ‘five-eyes’ countries Australia, New Zealand, the United Kingdom and Canada — that it has no intention to fight a new Cold War with the United States. By striking a conciliatory tone, China aims to reduce the likelihood of the United States building a coalition against it. China’s ‘anti-Cold War’ effort can also be seen in Wang Yi’s recent visits to five European countries.
Other interested countries — especially US allies — will need to choose whether to turn the Cold War into a reality or treat it as an illusion of the four horsemen. While the Trump administration is trying to ‘checkmate’ China through short-term confrontation, Chinese leaders are playing a game of ‘Go’ insofar as they are seeking to position themselves for future advantages. This avoids direct confrontation in a game of high stakes, even if it forsakes short-term gains.
The third and final message is a warning to the international community about the danger of a potential conflict between the United States and China. There are worries about the ‘guns of August’ in the Asia Pacific — any strategic miscalculation or military accident might trigger a hot and potentially nuclear conflict in the South China Sea, East China Sea or over the Taiwan Strait.
China’s top diplomats have made it clear that China’s red line is CCP rule. The recent visit by US Health Secretary Azar to Taiwan may have led to Chinese military exercises around the Taiwan Strait as well as the ‘carrier killer’ missile test in the South China Sea . In Confucian culture, a country is expected to lose in battle if it…
China
New Publication: A Guide for Foreign Investors on Navigating China’s New Company Law
The sixth revision of China’s Company Law is the most extensive amendment in history, impacting foreign invested enterprises with stricter rules on capital injection and corporate governance. Most FIEs must align with the New Company Law by July 1, 2024, with a deadline of December 31, 2024 for adjustments. Contact Dezan Shira & Associates for assistance.
The sixth revision of China’s Company Law represents the most extensive amendment in its history. From stricter capital injection rules to enhanced corporate governance, the changes introduced in the New Company Law have far-reaching implications for businesses, including foreign invested enterprises (FIEs) operating in or entering the China market.
Since January 1, 2020, the Company Law has governed both wholly foreign-owned enterprises (WFOEs) and joint ventures (JVs), following the enactment of the Foreign Investment Law (FIL). Most FIEs must align with the provisions of the New Company Law from July 1, 2024, while those established before January 1, 2020 have bit more time for adjustments due to the five-year grace period provided by the FIL. The final deadline for their alignment is December 31, 2024.
In this publication, we guide foreign investors through the implications of the New Company Law for existing and new FIEs and relevant stakeholders. We begin with an overview of the revision’s background and objectives, followed by a summary of key changes. Our in-depth analysis, from a foreign stakeholder perspective, illuminates the practical implications. Lastly, we explore tax impacts alongside the revisions, demonstrating how the New Company Law may shape future business transactions and arrangements.
If you or your company require assistance with Company Law adjustments in China, please do not hesitate to contact Dezan Shira & Associates. For more information, feel free to reach us via email at china@dezshira.com.
This article is republished from China Briefing. Read the rest of the original article.
China Briefing is written and produced by Dezan Shira & Associates. The practice assists foreign investors into China and has done since 1992 through offices in Beijing, Tianjin, Dalian, Qingdao, Shanghai, Hangzhou, Ningbo, Suzhou, Guangzhou, Dongguan, Zhongshan, Shenzhen, and Hong Kong. Please contact the firm for assistance in China at china@dezshira.com.
China
Lingang New Area in Shanghai Opens First Cross-Border Data Service Center to Streamline Data Export Process
The Lingang New Area in Shanghai has launched China’s first Cross-Border Data Service Center to facilitate data export for companies in Shanghai. The center will help with applications, data catalogs, and management, aiming to provide legal and safe cross-border data transfer mechanisms.
The Lingang New Area in Shanghai’s Pilot Free Trade Zone has launched a new cross-border data service center to provide administrative and consulting services to companies in Shanghai that need to export data out of China. The service center will help facilitate data export by accepting applications from companies for data export projects and is tasked with formulating and implementing data catalogs to facilitate data export in the area. The Shanghai cross-border data service center will provide services to companies across the whole city.
The Lingang New Area in the Shanghai Pilot Free Trade Zone has launched China’s first Cross-Border Data Service Center (the “service center”). The service center, which is jointly operated by the Cybersecurity Administration of China (CAC) and the local government, aims to further facilitate legal, safe, and convenient cross-border data transfer (CBDT) mechanisms for companies.
The service center will not only serve companies in the Lingang New Area but is also open to companies across Shanghai, and will act as an administrative service center specializing in CBDT.
In January 2024, the local government showcased a set of trial measures for the “classified and hierarchical” management of CBDT in the Lingang New Area. The measures, which have not yet been released to the public, seek to facilitate CBDT from the area by dividing data for cross-border transfer into three different risk categories: core, important, and general data.
The local government also pledged to release two data catalogs: a “general data” catalog, which will include types of data that can be transferred freely out of the Lingang New Area, and an “important data” catalog, which will be subject to restrictions. According to Zong Liang, an evaluation expert at the service center, the first draft of the general data catalog has been completed and is being submitted to the relevant superior departments for review.
In March 2024, the CAC released the final version of a set of regulations significantly facilitating CBDT for companies in the country. The new regulations increase the limits on the volume of PI that a company can handle before it is required to undergo additional compliance procedures, provide exemptions from the compliance procedures, and clarify the handling of important data.
Also in March, China released a new set of technical standards stipulating the rules for classifying three different types of data – core, important, and general data. Importantly, the standards provide guidelines for regulators and companies to identify what is considered “important” data. This means they will act as a reference for companies and regulators when assessing the types of data that can be exported, including FTZs such as the Lingang New Area.
This article is republished from China Briefing. Read the rest of the original article.
China Briefing is written and produced by Dezan Shira & Associates. The practice assists foreign investors into China and has done since 1992 through offices in Beijing, Tianjin, Dalian, Qingdao, Shanghai, Hangzhou, Ningbo, Suzhou, Guangzhou, Dongguan, Zhongshan, Shenzhen, and Hong Kong. Please contact the firm for assistance in China at china@dezshira.com.
China
A Concise Guide to the Verification Letter of Invitation Requirement in the China Visa Process
The application procedures for business visas to China have been simplified, with most foreigners now able to apply for an M/F visa using only an invitation letter from a Chinese company. Some countries are eligible for visa-free entry. However, a Verification Letter of Invitation may still be needed in certain cases. Consult the local Chinese embassy for confirmation.
In light of recent developments, the application procedures for business visas to China have undergone substantial simplification. Most foreigners can now apply for an M/F visa using only the invitation letter issued by a Chinese company. Additionally, citizens of certain countries are eligible to enter China without a visa and stay for up to 144 hours or even 15 days.
However, it’s important to note that some applicants may still need to apply for a “Verification Letter of Invitation (邀请核实单)” when applying for an M/F visa to China. In this article, we will introduce what a Verification Letter of Invitation is, who needs to apply for it, and the potential risks.
It’s important to note that in most cases, the invitation letter provided by the inviting unit (whether a public entity or a company) is sufficient for M/F visa applications. The Verification Letter for Invitation is only required when the Chinese embassies or consulates in certain countries specifically ask for the document.
Meanwhile, it is also essential to note that obtaining a Verification Letter for Invitation does not guarantee visa approval. The final decision on granting a visa rests with the Chinese embassy abroad, based on the specific circumstances of the applicant.
Based on current information, foreign applicants in Sri Lanka and most Middle East countries – such as Turkey, Iran, Afghanistan, Syria, Pakistan, and so on – need to submit a Verification Letter for Invitation when they apply for a visa to China.
That said, a Verification Letter for Invitation might not be required in a few Middle East countries, such as Saudi Arabia. Therefore, we suggest that foreign applicants consult with their the local Chinese embassy or consulate to confirm in advance.
This article is republished from China Briefing. Read the rest of the original article.
China Briefing is written and produced by Dezan Shira & Associates. The practice assists foreign investors into China and has done since 1992 through offices in Beijing, Tianjin, Dalian, Qingdao, Shanghai, Hangzhou, Ningbo, Suzhou, Guangzhou, Dongguan, Zhongshan, Shenzhen, and Hong Kong. Please contact the firm for assistance in China at china@dezshira.com.
- New Publication: A Guide for Foreign Investors on Navigating China’s New Company Law
- Lingang New Area in Shanghai Opens First Cross-Border Data Service Center to Streamline Data Export Process
- A Concise Guide to the Verification Letter of Invitation Requirement in the China Visa Process
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